Which type of cost includes brand loyalty issues and recall logistic costs?

The type of cost that encompasses brand loyalty issues and recall logistic costs is external failure costs. External failure costs occur when a product fails to meet quality standards after it has been delivered to the customer. This includes costs associated with product recalls when items must be taken back from customers due to safety issues or defects. Such recalls not only involve the logistics of retrieving the product but also impact customer perception and brand loyalty.

When customers lose trust in a brand due to quality issues, it can lead to decreased sales and increased marketing costs to regain consumer confidence, further illustrating the impact on brand loyalty. External failure costs, therefore, represent the broader financial consequences of quality failures that occur outside the confines of the production environment, affecting the company's relationship with its customers.

In contrast, the other types of costs focus on different aspects of performance and quality. Internal failure costs relate to defects found before the product is shipped, prevention costs are associated with activities aimed at preventing defects, and appraisal costs involve expenses related to measuring and monitoring activities to ensure quality. However, these do not account for the ramifications of issues that affect the customer experience and loyalty, which is crucial for maintaining a successful business.